So why do some retail concepts thrive whilst others wither on the vine? A sweeping statement might say it’s failure to invest across the board: brand; stores; marketing; product; service; people. However, I feel it’s something more than that.
If you look at the demise of Austin Reed for example, how did this one-time bastion of middle England respectability – where everyone’s Father went to kit himself out – end up teetering on the brink of extinction? The need for a decent suit and something for the weekend is still there, but who goes to Austin Reed anymore?
Conversely you have Hackett, which seems to have spectacularly taken much of Austin Reed’s space and which has results moving nicely in the right direction. The brand has invested in great looking store interiors, lovely products, and has pitched its prices at the right level – nothing too cheap. These key retail factors, aligned with good service results in the overall experience in a Hackett store pleasing. Likewise, Selfridges has again announced a good set of results, and is now planning to plough a large amount of its profits back into refurbishing its Oxford St store. Appearance is important and rather than trying to eek out another year’s profit, Selfridge’s addressed the issue and updated before the stores started to look shabby. Rather like top hotels, these brands only stay at the top if they continually reinvest in the fabric of their buildings.
One might think that if it’s as simple as borrowing some cash from the bank, surely all retailers can make the moves to be a success. But it’s just not that simple. The investment must be spent wisely, Austin Reed spent millions on the refurb of its flagship store, but not in the development of its range, or its brand proposition. Austin Reed needed to speak to a new audience, its original faithful devotees were getting older and no one bothered to speak to the next generation.
Walking around London you see lots of small, niche players, starting to emerge – Scotch & Soda, a choccy brand that’s a great example. Are these small yet popular brands signs of a resurgent retail market? Or have appeared as an answer for the consumer’s need for quality and service? Sound familiar? Nowadays you can get value online but you don’t get the same level of service, or the feel of something special as you peruse the unique and carefully curated smaller shops. The supermarkets are just about to start investing in their stores again and it’s about time too, consumers are fed but with the drab.
As it stands now the middle market has some strong players, I’d say that in two years Diesel, Hackett and Jack Wills will still be going strong. But what about the likes of, Abercrombie & Fitch or Hollister? We’d better hope to see some serious brand development, new lines added and updated stores or we fear they will be lost to the fate of poor old Mr Reed…